Sean Hughes, Account Director, Cronin & Hughes.
By Sean Hughes, Connecticut Package Stores Association
For many years, Connecticut has been unfortunately labeled as too expensive a place to do business. Still, many aspiring business owners made the investment anyway, hopeful that with hard work and quality products they could succeed. Unfortunately for both fledgling and established businesses in our state, even just the expense of keeping the lights on has become too much to stay open.
Several factors contribute to Connecticut’s cost of living index, which is ranked the eighth most expensive place to live in the nation. It is no secret that Connecticut has been struggling to achieve affordable energy rates, especially as the demand for electricity increases with forthcoming clean energy mandates. Few retailers are more aware of this trend than package store owners, who are running refrigerators and freezers 24/7 in order to cool some of the most highly taxed products in the state.
Now, employers have another expense to keep in mind. As of June 1, 2023, Connecticut’s hourly minimum wage increased to $15, the last of five scheduled increases since beginning in 2019 after Public Act 19-4 was enacted. Before its passage, Public Act 19-4 was very controversial and heavily debated in the House of Representatives and State Senate.
Legislators in opposition shared concerns that the proposal would hinder economic development in the state and harm small businesses, which would have a more difficult time ramping up wages as quickly as larger corporations. Those in favor believed the change would lift minimum wage employees working full time out
of poverty.
Beginning next year, Connecticut’s minimum wage will be adjusted according to the U.S. Department of Labor’s calculation of the employment cost index for the 12-month period ending on June 30 of the preceding year. This means that the minimum wage will continue to increase with the national cost of employment index, without the need for any further legislation.
At the end of each June, the commissioner of the Department of Labor will review the increase based on the cost of employment index and will release the following year’s increase four months later, in October. The increase takes effect every Jan. 1.
According to a press release from Gov. Ned Lamont, Department of Labor Commissioner Danté Bartolomeo reported that the employment cost index had increased by 4.6% over the 12-month period ending on June 30, 2023, accounting for a 69-cent increase to the state’s minimum wage, which will take effect on Jan. 1, 2024.
Despite this increase to $15.69 by 2024, many local package stores have already been paying their employees higher wages since they opened their doors. Several stores offer benefits, practical and translatable training, and opportunities for advancement.
No matter the hurdle, homegrown businesses in Connecticut will continue to perform beyond what is required to deliver the best service to their customers in our state. To stay up to date on legislation that might impact your business, visit ctpsa.com and become a member today.
